How to Break the Legal Logjam in the South China Sea

Reuters
November 3, 2019 Topic: Security Region: Asia Tags: IndiaNarendra ModiSouth China SeaXi JinpingTrade

How to Break the Legal Logjam in the South China Sea

Washington could ask New Delhi, as part of its larger Indo-Pacific strategy, to lead the effort to broker accords on two levels to help establish a rules-based order in the South China Sea.

 

In November 2017 President Donald Trump commenced a five-nation Asian tour in which he announced that he was honored to be in the heart of the “Indo-Pacific” region. Following Trump’s speech, the United States issued the National Security Strategy (NSS) in December of 2017 and the National Defense Strategy (NDS) in January of 2018. In 2018 the U.S. Pacific Command was renamed the Indo-Pacific Command, designating India as a “major defense partner.” These actions together signal that the “Indo-Pacific” region has emerged as a revised conceptualization of the region where India and the Indian Ocean (and its littoral countries) are considered to be geographically and politically interdependent with the rest of Asia-Pacific region. More importantly, the rhetoric signals that India is now regarded by the United States as a major actor in an expanded region.

Current policies are intended to cast a larger net to bring former non-aligned countries (like India and Bangladesh) into the U.S. “camp” to confront what the United States believes to be revisionist trade, international law and security policies pursued by Beijing. The much enhanced strategic relationship with India fits within the framework of the so-called “Quad”, which includes the additional participation of Japan and Australia. The Quad converges on such topics as freedom of navigation, China’s Belt and Road Initiatives, China’s respect for international law, and, in the case of India, encirclement from Chinese projects in Pakistan.

 

Given the United States’ apparent “tilt” towards a more holistic regional approach that includes India, the question becomes how will this new rhetoric and realignment of the U.S. Info-Pacific Command actually manifest? To what extent are the United States and India’s policies aligned to confront Chinese behaviors that both countries regard as destabilizing? This paper will assess these questions and then project the types of concrete actions taken by the United States and India that could address joint areas of concern.

The Growing U.S.–India Relationship

United States’ Indo-Pacific strategy is premised on the need for “enhanced geo-economic connectivity between the Indian and Pacific oceans, shared prosperity, and the attendant need for good order and strategic stability.” In addition, Captain (Dr.) Gurpreet S. Khurana, from NMF, writes that India seeks to “maintain economic connectivity with India’s Eastern neighbors, good order at sea and a credible strategic deterrence against China.”

Additionally, the United States and India have increased their bilateral military engagements. In July 2019, Secretary of Defense Mark Esper told the members of the Senate Armed Services Committee that his “overall guiding objective for our relationship with India would be to solidify an enduring strategic partnership underpinned by strong defense cooperation with an Indian military able to collaborate effectively with the United States to address shared interests." Bilateral trade between the United States and India has also risen over the past few years and there has been a significant increase in the Indian purchases of U.S. defense equipment. The United States is India’s second-largest arms supplier, indicating a significant growth in arms transfers between the two countries. The military staff of India and the United States meet regularly. The countries also negotiated three defense agreements (two have been finalized). The jury is still out whether the relations between the United States and India will ever blossom into a full-fledged alliance given India’s past nonaligned history, former U.S. support for Pakistan and continued Indian reliance upon Moscow for advanced weapons. But, so long as India continues to upgrade its relations with Japan and the United States comes to be viewed as a reliable defense partner (through a combination of arms sales and joint exercises), the relationship should continue to grow in a positive direction.

India has shown an increased willingness to cooperate with the Organization of Cooperation and Development (OECD), which should pave the way for further and more sophisticated economic linkages between the United States and India. Lastly, there is no denying the increasingly strong bond between the United States and India that has been forged in the technology sector. According to the Wall Street Journal, India accounts for 47 percent of the new technology workers coming to the United States. These social linkages demonstrate the breadth of the multifaceted U.S.-India relationship.

Indian Concerns with China: BRI and Lack of Rules-Based Order in the SCS 

India increasingly views China as a major threat in the region. India is apprehensive of China’s “String of Pearl’s” policy because it fears that Chinese investments in East Africa, Pakistan, and Sri Lanka are leading to “maritime strategic encirclement.” India is concerned about the possibility of a “two-front war” involving Pakistan and China because of the high degree of military, economic, and political linkages between both countries. China and Pakistan have increased naval cooperation and continue to undertake joint exercises. China is supplying warships and more sophisticated navigation systems to Pakistan. Delhi perceives that the “strategic alliance” between Pakistan and China signifies that China is giving Islamabad a “green light” to fund terror attacks and provide armed support to both the Pakistani military and Jihadi groups in the Kashmir Valley. The China Pakistan Economic Corridor (CPEC), which is worth more than $50 billion, is a key pillar in China’s Belt and Road Initiative (BRI) has long fueled concerns in India of economic and military encirclement. The development of the Gwadar Port (likely a mixed commercial/military port) by the China Overseas Port Holding Company (under a forty-year lease from the Pakistani government) has heightened concerns by the Indian Navy in particular that it will have a PLA Navy base in its backyard with the capability to interfere with India’s energy imports from the Persian Gulf. Similarly, Sri Lanka’s recent decision to hand over the fifteen-thousand acre Hambantota Port to a Chinese State-Owned Enterprise, after the port officials in Hambantota were unable to make loan payments to their Chinese financiers, only stokes concern that the encirclement fears are not limited to Pakistan.

Collaborative Efforts to Combat Chinese BRI Activities.

Both U.S. and Indian security officials would agree that China’s pattern of foreign direct investment in South Asia and many other regions such as the Arctic, South Pacific, Africa and South America, is troubling for a number of important reasons. At the Shangri-La Dialogue, when discussing the topic of the South China Sea (SCS), Prime Minister Narendra Modi called for a “free, open and inclusive” region and “a common rules-based order.” Without a doubt, a not-so-veiled reference to China’s attempts to extend its jurisdiction in the SCS, construct artificial islands and undermine the viability of regional organizations like the Association of Southeast Asian Nations (ASEAN) and the ASEAN Regional Forum (ARF).

Even though the bilateral trade and investment relationship between the United States and India is comparatively immature, both countries may seek common ground in confronting current patterns of Chinese BRI investments. Both states perceive the BRI program as malignant and inconsistent with good faith foreign direct investment (FDI) flows. CNA recently undertook an assessment of Chinese FDI patterns in the Arctic, which faces similar challenges to the Indo-Pacific. In those instances in which an FDI has transboundary implications, it is appropriate for there to be multilateral instruments that establish FDI standards, development codes, and potentially regional development banks.

A Role for India & the United States in the South China Sea

The current dynamic in the SCS projects casts China in a very negative regionally. This provides an opening for the United States to work with India to convince China that it is in China’s best interest to negotiate a joint fisheries/hydrocarbon development scheme in the SCS vis-à-vis all of the other SCS claimants instead of pressing forward on some of the sovereignty and maritime claims that the international community has found objectionable. The agreement (or group of agreements) would not evaluate the merits of any of the claims but simply provide each party (on a provisional basis) a pro-rata share of any revenues from oil and gas, mineral(s), and fisheries until a more permanent arrangement could be adjusted.

India is a neutral party with both an interest in promoting a rules-based order in the SCS and maintains credibility because of its experiences in the Bay of Bengal using UNCLOS dispute settlement mechanisms to resolve its differences with Bangladesh. As such, the United States could ask India, as part of its larger Indo-Pacific strategy, to lead the effort to broker accords on two levels to help establish a rules-based order in the SCS.

The first accord would be a scheme to shelve the sovereignty claims and allow for joint development. This would promote regional/sustainable development in the SCS in which the parties would be China and the major SCS claimant countries beginning with the Spratly Islands. As much as brokering such a scheme would garner India international praise and increase its prestige throughout the Indo-Pacific region, India-China bilateral trade has been on the rise and it hit a historic high of $84.4 billion in 2017. Given the importance of this trade relationship, the United States may need to encourage India, to make quiet approaches to China that a joint development scheme would greatly improve China’s standing in the region and, in the long run, open more economic doors for China.